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$BRC's 3Q16 revenues were down 1.2% to $286.8MM vs. 3Q15, which consists of an organic sales decline of 0.1% and a reduction of 1.1% due to foreign currency translation. Division-wise, the company's organic sales fell by 0.8% in the Identification Solutions segment and rose by 1.2% in the Workplace Safety segment.
In $BRC’s Identification Solutions segment, total sales decreased 2.3% to $196.9MM during 3Q17. Sales in Asia increased in the double digits compared to 3Q16 and Europe showed slight organic growth. The Americas IDS business declined in the low single digits organically. Total sales in Workplace Safety were $79MM in 3Q17.
During 3Q17, $BRC’s organic sales in the Identification Solutions segment decreased 0.8%. In the Workplace Safety segment, organic sales decreased 4.6%. This quarter was impacted by 1.7 fewer billing days compared to 3Q16. Foreign currency decreased sales by 1.9%. Gross profit margin was 50.7% in 3Q17.
Regarding the Asia region, $BRC said it has made some significant changes there and pleased with the leadership focus. China has been a drag in the results with economic headwinds that remain unchanged, the company said. $BRC expects to drive a more effective approach to sales development there and overcome those headwinds.
$BRC's ID Solutions' segment profit was $33.1MM in 1Q17, up 20% from a year ago, helped by growth in European organic sales. Workplace Safety segment profit declined 31% to $6.5MM, hurt by direct results of reduced revenues and reduction in gross profit margin.
$BRC expects FY17 earnings per diluted Class A nonvoting common share to remain unchanged at $1.55-1.70. Organic sales were expected to range from a low single digit decline to slight positive growth. Capital expenditures were expected to be about $25MM.
$BRC's shareholders of class B common voting stock have voted unanimously in favor of election of director nominees to one-year term. The board declared a dividend of $0.205 per class A common share, payable on Jan. 31, 2017 to shareholders of record on Jan. 10, 2017.
Sidotti & Co. analyst Joseph Mondillo questions whether G&A costs will come down in FY17 vs. being up 4% in FY16. $BRC replies that it will not get too granular with FY17 cost, but in FY16, it was driven by equity-based compensation & higher bonus expenses. This was partially offset by efficiency gains that garnered traction leading to higher cost.
BoFA Merrill Lynch analyst George Staphos probes what drove the SG&A guidance in FY16. $BRC says that the biggest driver was the operational efficiency versus the SG&A reductions. The company's SG&A improvements were coming a bit slower than anticipated, so GM was clearly the driver of the performance vs. initial guidance.
Wells Fargo analyst Allison Poliniak questions if the European outgrowth is end-market specific relative to the other regions. $BRC answers by saying that it's a two-fold situation. Due to the nature of the European market and the industries involved vs. Brazil, US, Australia and oil & gas areas, the company is seeing better demand there as well.
During 4Q16, $BRC said that it returned $10.2MM to shareholders in the form of dividends, while repaying $24.3MM of debt. Cash generation in FY16 was strong, benefiting from improved net earnings and working capital. The company's total net debt position has benefited from the strong generation with net debt at July 31, 2016 totaling $75.7MM.
$BRC's 4Q16 gross profit margin was 50%, and excluding one-time charges recognized in 4Q15, the company's gross profit margin was approx. 47% from 4Q15. Sequentially, GM decreased from 50.7% in 3Q16, hurt by business mix. SG&A expense fell to $98.4MM vs. $102.9MM in 4Q15, due to the impact of stronger US dollar and reduced selling expenses.
In 4Q16, $BRC's revenues slumped 2.3% to $282.1MM vs. 4Q15. This decrease comprises of an organic sales decline of 0.9% and a decrease of 1.4% due to foreign currency translation. The company stated that it benefited from a lower than normal tax rate due to the conclusion of certain audits. Sales in Australia & US fell as a result of lower demand.
Maker of workplace safety products $BRC increased its 4Q16 EPS by 75% vs. non-GAAP results of 4Q15. Organic sales declined by just under 1% during 4Q16 and the company's R&D and new product development efforts continue to be a top priority as a strong pipeline of innovative product offerings is essential to grow organic sales over the long term.
For FY17, $BRC expects organic sales to range from a low single-digit decline to slightly positive growth and diluted earnings of Class A common share to range between $1.55-1.70. This earnings guidance range is based on foreign currency exchange rates as of July 31, 2016, which are expected to reduce FY17 revenues by approx. 1.5%.
$BRC's 4Q16 revenues were almost in line with expectations, finishing with lower organic sales of 0.9%. Demand has been choppy and profitability stronger than anticipated, as the company focuses on driving operational efficiencies and actively reducing its G&A structure, said CFO Aaron Pearce.
Maker and supplier of identification solutions $BRC posted higher 4Q16 results, helped by higher operating income. Net earnings were $25.1MM or $0.49 per diluted share vs. loss of $39.4MM or $0.77 loss per diluted share in 4Q15. Sales fell 2.3% to $282.1MM vs. 4Q15, hurt by lower sales in ID Solutions and Workplace Safety segments.